Concepto

Even in small businesses, there has been an increasing realization that in order to remain competitive, the need for technology integration is increasing. Until recently, the implementation of ERP systems has been mostly the domain of large businesses, requiring significant investments of resources (Andriole, 2006). The scale of the investment for a large business enterprise for an ERP system is frequently several million dollars, and extensive use of consultants and internal staff are required for implementation. While a small business is not required to invest at these levels, the proportionate resource commitment is still high (Davenport T., 1998).

Two issues are driving large portions of the small business community to adopt ERP;

firstly, as the natural supplier base to large businesses, there is a strong impetus for adopting ERP systems that can integrate at a higher level with the client’s systems, thereby making the small business a better fit in the supply chain; and secondly, ERP providers are developing new offerings that provide much of the functional capability at lower cost than those of the major systems, such as SAP & etc. (Mabert, V. A., Soni, A.,

& Venkataramanan, M. A., 2001) (Chen, 2001). There are still challenges though, in particular the expenses of implementation and reengineering of business processes to accommodate these more sophisticated systems, and a poor internal facility to gauge the value of an ERP to the bottom line (Nah, 2001). More recent research has explored the total cost of ownership which includes acquisition, implementation, maintenance, training

etc. (Babey, 2006). Of course, access to information about these costs is frequently regarded as proprietary to the ERP vendor and is difficult for a small business to obtain.

In their review of the developments and directions of operations management (Jacobs &

Bendoly, 2003) suggested that the domain of research interest in ERP systems has bifurcated into two main paths; one which focuses independently on corporate capabilities with respect to ERP strategies, and those which deal with the respective benefits and costs of IT systems. The proposed research will address the inter-relationship of both of these factors as they apply to the selection decision process and investigate the effect of success criteria of implementations at small manufacturing businesses. Several researchers have demonstrated that it is an accepted fact that business systems are more appropriately modified to accept existing software implementations of ERP systems than vice versa (Al-Mudimigh, Zairi, & Al-Mashari, 2001).

Due to the paucity of empirical research, case studies are proposed to represent a strong foundational contribution to the domain of academic research into issues related to success of ERP implementation projects (Madapusi & Ortiz, 2009) (Wei C. , 2008) (Motwani J. , 2005) (Kumar, Maheshwari, & Kumar, 2002) accordingly, this study will address the experiences of small businesses engaged in defense manufacturing.

In a review of the research agenda of ERP studies (Al-Mashari M., 2003) a contextual framework is proposed which includes taxonomy of ERP research. The outcome of the proposed research will address several elements of the current ERP research agenda and extend both the academic and practical uses of the fit assessment process.

Chang (2008) proposed that social factors, perceived consequences, complexity and other elements, as measured by such models as the Triandis framework, drawn from Triandis’

“Theory of Interpersonal Behavior” (Triandis H. C., 1971) (Triandis H. C., 1980), can affect the user’s perspective when adopting new technology. Chang’s study indicates that the actual success vs. perceived success of an ERP implementation is a very real facet of the user’s overall view of the system and its value to the enterprise. They conclude that active and positive managerial support, with a socialized and reasoned approach to establishing a “supportive social environment” is critical to both actual and perceived success.

Beliefs About Outcomes

Evaluation of Outcomes

Norms Roles

Selfconcept

Attitude

Social Factors

Emotions Affect

Intention Facilitating Conditions

Behavior

Frequency of Past Behavior Habits

Figure 2 - Triandis' Framework

(Wang & et al., 2007) have proposed a fundamental relationship to ERP implementation success, based on three parameters; Client “absorptive capacity”, defined as the ability of a team to recognize value, assimilate and utilize new, external knowledge; the competence of the implementing consultant; and the effectiveness of the knowledge transfer occurring during the implementation phase. More recently, (Morton & Hu, 2008) have suggested a review framework based on structural contingency theory and drawing on the use of Mintzberg’s seminal work on organizational structure (Mintzberg, 1979). ERP systems are perceived as assets within a company when the social acceptance factors are positive with respect to the benefits of an improved work environment are recognized. Such social acceptance is enhanced by positive support from managers, and demonstrated benefits such as compatibility of the ERP system with an individual’s working mode, and early demonstration of these benefits (Chang & et al., 2008).

Several studies have demonstrated support for the view that a gap between the ERP systems processes and those of the business are inevitable (Gefen, 2002) (Sawyer, 2000).

There is an unresolved discussion regarding the options of undertaking business process reengineering that accommodates the ERP systems underlying processes, or whether to customize the software to accommodate existing business practices. Hong and Kim (2002) assert that the ERP fit and operational contingencies are both important facets in establishing success of implementation, while also indicating that the decision to change the business process to accommodate the ERP process is sometimes preferable to an

extended effort to change the ERP model to fit the business. Boudreau and Robey (1999) adopt the view that organizations need to be changed to fit the ERP software. Other studies conclude that the adaptation of the ERP system to the businesses operational processes is preferable (Markus, M.L., & Tanis, C., 2000), (Holland, C.P., & Light, B., 1999). A third opinion seems to forming around the philosophy that ERP systems should be modified to fit existing or reengineered business processes (Brehm, Heinzl, & Markus, 2001) (Davenport T., 1998) (Glass, 1999). Gyampah and Salam (2004) explored the possible effects of the Technology Acceptance Model, and its implications on the perceived and actual success of ERP implementation. They also explored the effects of training, and communications in managing expectations and advancing the acceptance of new technology in the workplace (Gyampah & Salam, 2004).

A case study of an implementation failure is used to elucidate the key skills and integration strategies essential for implementation success. The study identified five core competencies: 1. Adopting a change strategy development and deployment, 2. Employing enterprise-wide project management, 3. Using change management techniques and tools, 4. BPR Integration with IT, and 5. An understanding of the strategic, architectural and technical aspects of the software installation (refers specifically to SAP R/3) (Al-Mashari

& Zairi, 2000).

In a later work, the team proposes an integrative framework to aid in ERP software implementation, and notes several additional deficiencies that must be overcome to succeed in implementation. These include a recommendation for an evaluation process to monitor short and long term benefits from ERP usage, the inclusion of an assessment

of IT competencies, and the essential nature of balancing strategic objectives in the ERP selection process. While this paper does propose an integrative framework for the implementation phase, it fails to extend the domain of analysis to the selection process itself, although it does recognize its importance to the overall success of an ERP introduction (Al-Mudimigh, Zairi, & Al-Mashari, 2001).

Motwani et al. (2005) suggest that their case studies reveal a complementary result, specifically noting the positive impacts of a cautious, evolutionary, bureaucratic implementation process, backed with careful change management, network relationships, and cultural readiness.